Berger & Montague, P.C. Sues Facebook

Posted: May 24, 2012

Source: PRNewswire

Practice Areas: Securities Litigation

PHILADELPHIA, PA - On May 23, 2012, Berger & Montague, P.C.
filed a class action lawsuit in the United States District Court,
Southern District of New York, on behalf of all persons who
purchased the common stock of Facebook, Inc. ("Facebook" or the
"Company") pursuant and/or traceable to the Company's May 18, 2012
initial public offering (the "IPO" or the "Offering").

Investors who bought Facebook (Nasdaq:FB) may move the court to
appoint them as lead plaintiff no later than July 23, 2012. A lead
plaintiff is a representative party acting on behalf of other class
members in directing the litigation. Investors in Facebook who wish
to discuss this action or the lead plaintiff selection process may
contact Todd S. Collins, Esquire or Robin Switzenbaum, Esquire of
Berger & Montague, P.C. toll free at 1-888-891-2289 or by
e-mail at tcollins@bm.net or
rswitzenbaum@bm.net. A
copy of the Class Action Complaint can be viewed on Berger &
Montague's website at www.bergermontague.com or may
be viewed online via the U.S. Pacer System. The case is
Goldrich Cousins P.C. 401(k) Profit Sharing Plan & Trust,
Individually and on Behalf of All Others Similarly Situated v.
Facebook, Inc., Mark Zuckerberg, David A. Ebersman, David M.
Spillane, Marc L. Andreesen, Erskine B. Bowles, James W. Breyer,
Donald E. Graham, Reed Hastings, Peter Thiel, Morgan Stanley &
Co. LLC, J.P. Morgan Securities LLC and Goldman Sachs &
Co..

Facebook operates a social networking company worldwide. On or
about May 16, 2012, Facebook filed with the SEC an amended
Registration Statement for the IPO. On May 18, 2012, the Prospectus
with respect to the IPO became effective and 421 million shares of
Facebook common stock were sold to the public at $38/share, thereby
valuing the total size of the IPO at more than $16 billion. The
Complaint alleges that the Registration Statement and Prospectus
contained untrue statements of material facts, omitted to state
other facts necessary to make the statements made not misleading
and were not prepared in accordance with the rules and regulations
governing their preparation. Specifically, defendants failed to
disclose that Facebook was experiencing a severe reduction in
earnings growth and that, while the IPO roadshow was in progress,
the Company guided the underwriters to materially lower their
earnings forecasts for 2012. During the roadshow conducted in
connection with the IPO, each of the lead underwriters reduced its
second quarter and full year 2012 earnings estimates for Facebook,
which constituted material information that was not shared with all
Facebook investors, but rather, was selectively disclosed by
defendants to certain large institutional investors and omitted
from the Registration Statement and/or Prospectus.

As of May 23, Facebook common stock was trading at approximately
$32/share, or $6/share below the price of the IPO. Plaintiff and
the Class have suffered losses of more than $2 billion since the
IPO.